The treatment of inherited assets is often an issue in a divorce, and the question of whether the spouse who inherited those assets should automatically be able to retain those assets themselves arises.

Unfortunately the reality is that there is no one answer.  It depends on all the circumstances of the case including:-

  • how long the couple have been married;
  • how much the inheritance was;
  • when the inheritance was received;
  • what the inheritance has been used for;
  • the couple’s standard of living (including the extent to which the inheritance has assisted with that standard of living);
  • any pre-nuptial or post-nuptial agreement entered into by the parties; and
  • what the needs of the husband, wife and any children of the marriage are.

It is therefore extremely important that early advice is taken in the event of the breakdown of a marriage, or at the time of the receipt of an inheritance (if there is concern about the viability of a relationship) so that the specific circumstances can be considered.

The Court has a very wide discretion in matrimonial cases and has made it very clear that each type of inherited property can be treated differently depending on the circumstances.  For example, an inherited farm, or shares in a family business, or an heirloom, that has passed down through the family for generations may well be treated in a different way to an inheritance of money.  The Court to look at what is “fair” and this will vary in each case.

In long marriages there is a presumption that the Court will divide the assets equally.  An inheritance provides an opportunity to seek a departure from that argument.  To secure the best possibility of preserving any inherited assets from a spouse’s claims on divorce it is helpful to:-

  • Keep the inherited asset in your sole name i.e. keep property in your name only, keep funds in a sole account etc;
  • Try not to use the asset for joint benefit during the marriage;
  • Enter into a pre-nuptial or post-nuptial agreement to ring fence the asset;
  • Take advice as soon as possible in the event of a marital breakdown.